Menu

Real Time Bidding’s Growth Trajectory Dependent on Pricing

Posted by Steve Goldberg

|

May 26, 2013

Real-time bidding (RTB) is probably the fastest-growing segment of digital advertising. eMarketer predicts that 19% of digital display ads will be purchased through RTB this year – that is a 73% increase from last year.
James Green, CEO of Magnetic (one of the search retargeting leaders) credits site retargeting for this explosive growth (meaning that if someone visits your site you can target them again, because you will see them again on an exchange due to the massive amount of liquidity).

The challenge in future growth, per James, is pricing. Publishers want higher CPM’s, and Advertisers are focused on cost. Here is how James sees price increases aiding in the long-term growth of RTB:

1. Advertisers are generally prepared to pay more to find a new customer than to convert an existing customer. So as the lower part of the sales funnel fills up and more “branding” campaigns come to RTB, pricing will move upwards.

2. The laws of supply and demand state that if demand stays flat or increases while supply decreases, prices will go up; this is exactly what’s going to happen in RTB.

3. As everyone gets better at assigning value to each marketing touch point, upper-funnel (more expensive) campaigns will get more value, which will help publishers raise CPMs.

Stay Informed

About MRG

Media Recruiting Group is the leading executive search firm for digital media sales positions- online, mobile, media technology sales - across the country. We serve markets in New York, Los Angeles, San Francisco, Chicago, and all major metropolitan areas.

Did you know?

Quote Library

"Nothing will ever be attempted if all possible objections must be first overcome." - Samuel Johnson (English Poet, Critic and Writer. 1709-1784)

"Neither a wise nor a brave man lies down on the tracks of history to wait for the train of the future to run over him." - Dwight David Eisenhower

"Sales are contingent upon the attitude of the salesman - not the attitude of the prospect." - W. Clement Stone (American bestselling Author and Founder of Combined Insurance Co, 1902-2002)

"The fishermen know that the sea is dangerous and the storm terrible, but they have never found these dangers sufficient reason for remaining ashore." - Vincent van Gogh Dutch painter, one of the greatest of the Post- Impressionists, 1853-1890

"Nobody trips over mountains. It is the small pebble that causes you to stumble. Pass all the pebbles in your path and you will find you have crossed the mountain." - Unknown

"If you think hiring the right people is expensive, watch what happens if you hire the wrong people." - Steve Goldberg, Media Recruiting Group

"Happiness lies in the joy of achievement and the thrill of creative effort." - Franklin Roosevelt

"Daring ideas are like chessmen moved forward. They may be beaten, but they may start a winning game." - Johann Wolfgang von Goethe (German Playwright, Poet, Novelist and Dramatist. 1749-1832)

"It is not by muscle, speed, or physical dexterity that great things are achieved, but by reflection, force of character, and judgment." - Marcus Tullius Cicero (Ancient Roman Lawyer, Writer, Scholar, Orator and Statesman, 106 BC-43 BC)

"Planning is bringing the future into the present so that you can do something about it now." - Alan Lakein

"The ultimate compliment a customer can make to an organization about one of its sales people is: I'm not sure whether your sales rep works for me or for you."- Buck Rodgers, Author of The IBM Way and Getting the Best Out of Yourself and Others

"For every sale you miss because you're too enthusiastic, you will miss a hundred because you're not enthusiastic enough." - Zig Ziglar (American motivational Speaker and Author.